Loper v. Adams
2011 ND 68
| N.D. | 2011Background
- Kost and Kraft formerly operated Kost & Kraft Harvesting; partnership ended in spring 2003 but equipment sharing continued in 2003–2004.
- In 2007 Kost sued Kraft to dissolve the partnership and to resolve proceeds from a 2007 equipment auction, while Kraft counterclaimed for money under alleged oral agreements to lease equipment (2003–2004) and to perform 2005 work.
- The district court granted summary judgment dismissing Kraft’s counterclaims as unenforceable under the statute of frauds and due to alleged settlements of bankruptcy disclosures; it also found no part performance.
- Kraft argued the oral lease was enforceable and claimed Kost received and accepted the equipment; Kost argued the lease was governed by the statute of frauds and that part performance did not validate it.
- On appeal, the North Dakota Supreme Court held there are disputed material facts about application of the statute of frauds to the alleged oral lease and that Kraft’s bankruptcy status does not conclusively preclude the counterclaims; the case is reversed and remanded.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is the alleged oral lease enforceable despite the statute of frauds due to part performance? | Kost argues no enforceable oral lease; writing required under N.D.C.C. § 41-02.1-10(4)(c). | Kraft contends the oral lease is enforceable under part performance and U.C.C. relaxation of the statute of frauds. | Disputed material facts; summary judgment improper; remand. |
| Are Kraft's counterclaims precluded by his bankruptcy proceedings? | Kost argues res judicata/equitable/judicial estoppel prevents Kraft from pursuing counterclaims. | Kraft argues assignment from bankruptcy estate and absence of closure preclude estoppel. | Res judicata estoppel not established; remand. |
Key Cases Cited
- Littlefield v. Union State Bank, 500 N.W.2d 881 (N.D. 1993) (bankruptcy-related preclusion rules)
- Buettner v. Nostdahl, 204 N.W.2d 187 (N.D. 1973) (part performance must prove existence of oral contract beyond mere likelihood)
- Hofmann v. Stoller, 320 N.W.2d 786 (N.D. 1982) (receip tand acceptance (U.C.C. 2-606) allows relaxed statute for sale of goods; applies to part performance)
- Shark v. Thompson, 373 N.W.2d 859 (N.D. 1985) (overruled related grounds in Buettner; context for part performance)
- Bragg v. Burlington Res. Oil & Gas Co., L.P., 763 N.W.2d 481 (N.D. 2009) (summary judgment standards and de novo review)